The European Investment Bank (EIB), alongside the European Investment Fund (EIF) have agreed to provide BBVA with a EUR 143 million mezzanine guarantee facility to support investment projects for Spanish SMEs. This operation will allow BBVA to provide SMEs with finance of up to EUR 1 billion in SME funding. The agreement benefits from the support of the Investment Plan for Europe and was signed today by the EIB Vice President, Román Escolano and the BBVA Chief Executive Officer, Carlos Torres Vila.
This agreement was made possible by the support of the European Fund for Strategic Investments (EFSI). The EFSI is the central pillar of the European Commission’s Investment Plan for Europe, the so-called “Juncker Plan”.
This is the first mezzanine guarantee transaction which the EIB and EIF are jointly supporting. The agreement will allow BBVA to fund a new portfolio of SME investment projects. Through this agreement, the EIB Group seeks to bolster support for small and medium-sized enterprises across the different sectors of the Spanish economy, offering loans on favourable terms to fund business operations subject to lower interest rates and more comfortable repayment schedules.
Today’s is also the first ‘mezzanine’ guarantee facility for a securitisation underwritten in Spain under the Investment Plan for Europe. The Investment Plan’s backing allows the EIB Group to fund investment projects that, due to their nature or structure and in line with the guiding principle of the ‘Juncker Plan’, entail higher-risk activities, promote business competitiveness and help create new jobs. The transaction is also the biggest synthetic securitisation ever in Spain, and in Europe in recent years.
“Support for SMEs is one of the EIB’s priorities because by funding them we are boosting economic growth, innovation and employment. This agreement with BBVA helps us to reach SMEs across the country, increasing access to crucial long-term financing in order to help them continue to develop new projects and to generate growth”, said the EIB Vice-President, Román Escolano, during the signing event.
EIF Chief Executive, Pier Luigi Gilibert said: “This represents an important milestone for the EIB Group as it is the first synthetic SME securitisation supported by the EIB Group in Spain. SME synthetic securitisations are usefully deployed by a number of European banks to provide regulatory capital relief. EIF is pleased to be working with BBVA and the EIB and notes with satisfaction that the regulatory capital released will allow BBVA to provide additional access to finance for Spanish SMEs. The combination of EIF’s investment and structuring expertise and the EIB’s efficient deployment of EFSI funds offer a competitive solution for BBVA which will serve to boost the supply of finance in the real economy.”
BBVA CEO Carlos Torres Vila noted that “with this agreement, BBVA reaffirms its clear intent to support the Spanish business industry’s growth, digitization and international competitiveness. BBVA is clearly committed to the future of Spanish SMEs, a commitment in line with its Creating Opportunities motto.”